Savannah Continues its African “Empire Building”, Despite the Obstruction in Chad - Africa’s premier report on the oil, gas and energy landscape.

Savannah Continues its African “Empire Building”, Despite the Obstruction in Chad

British junior Savannah Energy is forging ahead on its empire building in African energy, despite the obstruction posed by the nationalization of the assets it bought in Chad.

The company signed a Memorandum of Understanding MoU with the government of Niger Republic to construct 200MW capacity solar plants on May 11, 2023. That’s less than two weeks after it concluded an agreement with the Cameroonian Government, to build a 75MW Hydropower Plant in that country.

The proposed solar plants, in Niger, two of them, are to be sited within 20 km of the cities of Maradi and Zinder, respectively, in southern Niger. They will be connected to the South-Central section of Niger’s electricity grid, which is forecast to be interconnected to the Western electricity grid zone (which serves Niamey) by 2026, as part of a World Bank funded project.

These solar plants come in addition to the up to 250 MW Parc Eolien de la Tarka, the wind farm project, for Niger Republic, which Savannah signed with the government in 2022, and is expected to start construction in 2024. In total therefore, the solar and wind power projects to which Savannah has committed to, in Niger Republic, totals 450MW in capacity. These are projects outside its main purview: to monetise oil and gas resources.

In Cameroon, the signing of the MoA for the Bini a Warak Hydroelectric Project, located in the country’s northern Adamawa Region, will be followed up with an updating of existing feasibility studies and work with power industry authorities and development finance institutions to finalise the development, financing and resumption of construction. Savannah expects to fund the Bini Project from a combination of its own internally generated cashflows and project-specific debt.

The agreements for Hydropower construction in Cameroon and Solar in Niger come after Savannah sold a minor stake in the Cameroon Oil Transportation Company S.A. (COTCo) to Cameroon’s state hydrocarbon firm, SNH.

COTCo owns and operates the 903km Cameroon section of the Chad-Cameroon export pipeline, the Kome Kribi 1 floating storage and offloading facility and related infrastructure. Completion of the transfer of the Shares from Savannah to SNH will result in Savannah’s shareholding in COTCo reducing from 41.06% to 31.06%.

Savanah Energy is primarily a Hydrocarbon company; the largest project in its portfolio is ownership and operation of a gas processing plant and related infrastructure in Nigeria, from which it supplies 142Million standard cubic feet of gas per day (142MMscf/d) to several power plants, making it one of the three largest independent suppliers of gas to the country’s domestic market.

Savannah has made several oil discoveries in Niger Republic and is on course of developing them.  But the UK firm seems to have decided that one way to the hearts and minds of governments it deals with in Africa is to get involved in their power infrastructure projects.

 

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